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June 3rd, 2016:

Quitting tobacco is not so easy for investors as sticking to ‘ethical’ stocks can be difficult

AXA’S insurance arm is to stop backing tobacco firms.

The company, the world’s biggest health insurer, said that as a healthcare provider, investing in the sector made no sense

But how many of its customers even knew the firm had around £1.6billion tied up in tobacco?

It’s worth pointing out, of course, that the move does not affect the fund management side of Axa’s business – just the money invested by its insurance arm.

Axa fund managers are still free to invest in whichever companies they believe will deliver the best returns for savers.

28M-hollies investment extra cigs biz 2

And many of those could include companies which manufacture and sell cigarettes and other tobacco products.

The Axa Framlington UK Growth fund, for example, has 3.6 per cent of its money in Imperial Tobacco. These businesses have been some of the most successful investments for savers over recent years.

The addictive nature of the customers of tobacco companies means the firms have been able to steadily grow their share price as well as pay a chunky dividend.

Over the past ten years, British American Tobacco shares have more than tripled from 1358p to 4182p.

That would have turned a £10,000 investment into £30,795. Imperial Brands has grown from 1670p to 3769p in that time.

Many savers may not like the idea of profiting from businesses which are making money selling this type of product.

But as some of the biggest firms in the FTSE 100 they are among the most common to be found in investment funds.

Savers have the option to pick an ethical fund, which can screen out all companies which profit from tobacco, arms or pornography, for example. But many people don’t want a blanket ban on anything ‘bad’.

So-called sin stocks, like it or not, have been incredibly successful investments over the years and ruling them out entirely could impact on your returns.

So is it possible to quit tobacco stocks without opting out of UK funds? Data provided by Hargreaves Lansdown shows that very few UK funds do not invest in the sector.

The Lindsell Train UK Equity fund is one of them. It looks for firms which will outperform over the long term.

Some 22 per cent of the £2.1billion fund is in financial services companies, including London Stock Exchange Group, and a further 22 per cent in beverage businesses such as Heineken and Diageo. It has returned 90 per cent over the past five years.

The Unicorn UK Smaller Companies fund has 15 per cent of its cash in industrial engineering businesses, 11.5 per cent in support services, and 11 per cent in construction companies. The fund has returned 76.1 per cent over the past five years.

The Unicorn UK Income and F&C Mid Cap funds also don’t include tobacco in their holdings.

Finding this information is quite difficult though.

Funds publish a full list of their investments as little as once a year, and some contain hundreds of companies, many of which you might never have heard of, which makes checking and comparing an arduous task.

And if you pick a fund on this basis it is important to remember that it is not part of the strategy of these funds to avoid tobacco, it is just what their investment choices happen to be.

So if avoiding the sector is important to you it is vital to regularly check for any changes. Of course, many savers won’t be concerned about tobacco. But perhaps they are worried about other sectors.

Franklin UK Smaller Companies has no oil companies or tobacco firms in its portfolio. Standard Life UK Equity Income Unconstrained has no oil or pharma stocks.

Adam Laird, investment manager at Hargreaves Lansdown, says: ‘Ethics is a personal subject and each saver will approach it differently – one person’s renewable wind energy is another’s blot on the landscape.’

Whatever your ethics, it’s crucial you check a fund before you hand over your savings to ensure you understand where your money is going.

Did you know, for example, that the £8billion Woodford Equity Income fund has 16.6 per cent of its cash in tobacco stocks? It also has 23.8 per cent in pharmaceutical firms.

Invesco Perpetual UK Growth has 19.7 per cent of its money in oil and gas companies, while the Liontrust Macro UK Growth fund has 18.7 per cent of its assets in pharmaceuticals.

Smokers distort health warnings on cigarette packs, research shows

A study finds that smokers feel ostracised in society because of strict legislation, including plain packaging, and often obscure the warnings

The author of a 10-year study of Australian smokers has criticised messaging that conveys they are ignorant of its harms, instead finding that they can get “very creative” in avoiding health warnings.

Simone Dennis, an associate professor at the Australian National University, interviewed smokers in public places over the course of a decade and found they increasingly felt marginalised from society because of strict legislation.

“Ten years ago, it was relatively easy to walk up to people and ask them about their smoking. But towards the end of the research, people would be suspicious because they thought I was going to ask them to move on or criticise them in some way.”

She said hostility to smokers in public was not necessarily congruent with science, which found limited evidence of the impact of smoke-laced air in the outdoors. “But it is completely congruent with the de-normalisation campaign that the state has done.”

Dennis said messaging that smokers were ignorant and simply needed to be educated of its harms to be motivated to quit was not held up by her research. She said they could be “very creative” in picking and choosing the messages that reached them.

She spoke to male smokers who would ask for or select packets with health warnings relating to pregnancy, and people with blue eyes who would avoid “the eye packet”.

“It’s almost like the cigarettes in particular packets had different qualities.”

It was common for people to negate the warnings or distort their meaning, such as by putting the cigarettes in another container or covering the packets with stickers.

Dennis interviewed a group of pregnant teenagers who were concerned about their first experience of childbirth, and were smoking in the hope it would reduce the weight of their babies.

“Their greatest fear was giving birth to a large baby … some of them had taken up smoking as a strategic response to alleviate their fear of giving birth to a large infant, while others were smoking harder. That’s obviously not the way messaging is intended to work …

“What it told me was this is not a situation of ignorance. They absolutely knew cigarettes were going to have an effect on their bodies, but they wanted it to.”

She said it was evidence of anti-smoking measures not working the way policymakers had intended; equally, pushing up the price of packets just forced some smokers to rearrange their budgets.

Dennis said she was neutral on the issue of smoking but had received a large volume of complaints from people unhappy with her approach, as well as resistance from public health.

“I’m not trying to encourage people to smoke or get them to stop. I’m just trying to understand their experience.”

According to Department of Health figures, smoking kills an estimated 15,000 Australians and has a social and economic cost of $31.5bn.

The federal and state governments have together committed to reduce the national adult daily smoking rate to 10% by 2018, as well as halve the Aboriginal and Torres Strait Islander adult daily smoking rate (from 47% in 2008).

The excise on tobacco products is to be increased by 12.5% each year from 2017 to 2020, by which point a packet will probably cost $45 or more.

Dennis said anti-smoking campaigns often targeted people belonging to lower-socioeconomic or marginalised groups, and had significant costs but limited success in terms of getting smokers to quit.

She said little was known about why smokers persisted with the habit in spite of warnings, the expense, and unshakeable evidence of the damage to health.

“It’s really hard to ask those questions in a tobacco-controlled space, so we don’t have research on it.”

She said the government needed to involve smokers more in the creation of public health campaigns.

“My research is recommending that we break down barriers between people that are crafting policy and people who are experiencing that policy as smokers,” she said.

“It seems the targets are critical to include as architects if they’re going to bear the brunt of it.”

Her findings have been published in a book, Smokefree, which documents the changing experience of smokers as Australia introduced world leading anti-tobacco laws. She will now pursue further research into third-hand smoke.

Plain cigarette packaging: From Australia with love

Although plain packaging for cigarettes is not part of the Quebec government’s stricter anti-smoking measures that just went into effect, some wish to import the restriction to Canada.

It was also the theme of this year’s World No Tobacco Day, which took place on May 31.

Despite the obvious and serious health hazards of smoking, we should think twice before imitating this Australian innovation.

In Canada, federal health warnings on cigarette packages have existed since 1989, and graphic health warnings since 2001.

They now occupy 75% of the surface of packages, placing Canada 4th in warning size among 77 countries where they are compulsory. But this is not enough for some.

Plain packaging forces tobacco manufacturers to standardize all of their packages using the same nondescript colour, the same size and shape, and no distinctive brand logos, or other design elements.

Australian smokers have been forced to buy cigarettes in plain packages since December 2012. Similar measures are now coming into force in Ireland, France, and the United Kingdom, and are being considered in more than half a dozen other countries. The Canadian government is jumping on the bandwagon, too.

But we should have a close look at the Australian experiment before we take the plunge.

As laudable as it is to want to reduce smoking and people’s exposure to tobacco smoke, it is very far from clear that plain packaging contributes to achieving this goal.

After all, would you stop eating fast food if it came in brown, unbranded boxes with a big picture of a dying fat man?

No statistically significant drop in the proportion of smokers had occurred in any of the five Australian mainland states one year after the implementation of plain packaging. According to a different survey and analysis, the Australian government argues that plain packaging, combined with a newer set of health warnings, is responsible for a drop of half a percentage point in smoking prevalence in the three years following implementation, compared to the three preceding years.

Another Australian government survey, though, indicates that the proportion of smokers among minors actually increased between 2010 and 2013, after two decades of decrease. While not statistically significant, this increase certainly suggests that plain packaging is not having the intended effect.

One possible reason for this is that the debranding of tobacco products through plain packaging may lead consumers to “downtrade” to lower-value brands or to no-brand products. This, in turn, would lower the average price of cigarettes and thereby increase the quantity demanded. There is some evidence that this is happening in Australia, and also that plain packaging has led to an increase in smuggling.

Smoking is already tightly regulated in Canada. It is likely that any additional regulation would have a low marginal benefit (if any), and carry high social costs. In all logic, the burden of proof should rest on the shoulders of plain packaging proponents.

A regulation of this magnitude should only be implemented if the case supporting it is scientifically valid, and this is not what Australia’s experiment shows. In case of doubt, the government should not rush to intervene but, on the contrary, should leave Canadians free to decide.

— Michel Kelly-Gagnon is president and CEO of the Montreal Economic Institute.

Pot And Cigarette Smoking Have At Least One Health Consequence In Common

Both kinds of smokers are at high risk of gum disease.

Middle-age people who have smoked marijuana for many years may have a higher risk of developing gum disease, according to a new study.

However, the study did not find a link between long-term marijuana use and several other health problems associated with cigarette smoking, the researchers said.

“What we’re seeing is that cannabis may be harmful in some respects, but possibly not in every way,” Avshalom Caspi, a co-author of the study and a professor of psychology and neuroscience at Duke University, said in a statement. “We need to recognize that heavy recreational cannabis use does have some adverse consequences, but overall damage to physical health is not apparent in this study.” [11 Odd Facts About Marijuana]

In the study, the researchers looked at 1,037 people who were born in New Zealand in 1972 or 1973, and followed them until the people were 38 years old. The researchers examined whether the people had used marijuana when they were between 18 and 38, and whether they had physical health problems at age 38.

The researchers found that, among the 38-year-olds who had regularly smoked pot for 15 to 20 years, 55.6 percent had gum disease, also called periodontal disease. In comparison, only 13.5 percent of the 38-year-olds who had never used marijuana had gum disease. In some cases, this disease may lead to tooth loss.

The results also showed that the people who had smoked marijuana for up to 20 years had brushed their teeth and flossed less frequently than those who had never smoked marijuana, according to the findings, published today (June 1) in the journal JAMA Psychiatry. However, the less-frequent brushing and flossing did not explain the link between marijuana use and gum disease, which suggests that marijuana use itself may lead to damage to the gums. [5 Surprising Ways to Banish Bad Breath]

Researchers have long known that cigarette smoking has been associated with a higher risk of gum disease, said Dr. Ronald P. Burakoff, chairman of dental medicine at Northwell Health in New Hyde Park, New York, who was not involved in the study. “So I am not surprised that marijuana use also is associated with periodontal disease,” Burakoff told Live Science.

In the new study, the researchers also looked at the dental and general physical health of 484 people in the study who had smoked cigarettes on a daily basis at some point in their lives. In line with previous research, they found that those people were also more likely to have gum disease than those who had never smoked.

But these people were also more likely to have problems with their lung function, higher blood sugar levels andinflammation than those who had never smoked cigarettes.

In contrast, when the researchers looked at the same aspects of lung function and cardiovascular health among the people who had smoked marijuana for up to 20 years, they did not find these aspects were worse than they were in the people who had never smoked marijuana.

One limitation of the new study was that the researchers looked only at specific aspects of the people’s health assessed at a specific age, the researchers said. This means that the use of marijuana still may be linked to other health problems, such as cancer, that tend to occur later in life, they said.

Previous research has found links between the use of marijuana and weight gain, brain changes and the worsening of sexual function, among other health problems.

The new results “should be interpreted in the context of prior research showing that cannabis use is associated withaccidents and injuries, bronchitis, acute cardiovascular events and, possibly, infectious diseases and cancer, as well as poor psychosocial and mental-health outcomes,” the researchers wrote.

End of vaping in Hong Kong? Government plans to ban import and sale of e-cigarettes

A bill banning the import and sale of electronic cigarettes will be submitted to the Legislative Council in the next legislative session, a lawmaker revealed after meeting a top health official.

Kwok Wai-keung of the Federation of Trade Unions said the plan was confirmed during a meeting with the Undersecretary for Food and Health, Professor Sophia Chan Siu-chee, on Thursday.

Hong Kong still plans e-cigarette ban despite new UK study claiming they’re 95% less harmful than tobacco

That came after Chief Executive Leung Chun-ying announced in his January policy address that the government would consider regulating e-cigarettes through legislation.

Before a ban comes into effect, officials said they would continue to educate the public on the harm of e-cigarettes, conduct tests and studies, monitor international regulatory developments and study legislative frameworks for a ban.

Kwok said the government should announce a list of e-cigarette products which had been inspected and found to contain harmful substances.

“The regulation of e-cigarettes is now imminent. Officials should draft a direction plan and list out short, mid and long-term measures,” Kwok said.

A million times more harmful than outdoor air: Hong Kong study raises e-cigarette cancer alarm

E-cigarettes can be purchased easily by primary and secondary school students in local shopping malls. A six-year-old girl was once spotted by the local media in Sham Shui Po inhaling a fruit-flavoured e-cigarette like an experienced smoker.

A study conducted by the University of Hong Kong between October 2014 and April last year found that 2.6 per cent of primary pupils and 9 per cent of secondary students had tried e-cigarettes.

While the harm of e-cigarettes remains unclear and some argue that the products could be used to help people quit, a Baptist University study revealed that the 13 e-cigarette samples it collected contained nicotine and cancer-causing substances.

But the Asian Vape Association, a group promoting the use of e-cigarettes, urged regulation rather than a total ban, claiming that complete prohibition would create a more active black market.

Think tank coalition condemns plain packaging

An international coalition of 47 think tanks and taxpayer associations sent a letter to World Health Organisation Director Margaret Chan criticising WHO’s support of plain packaging, which group condemns as an attack on intellectual property rights.

“Plain packaging prohibits the use of trademarks and therefore significantly erodes the value of this intellectual property,” the letter states. WHO made plain packaging to fight the spread of tobacco products the theme of World No Tobacco Day on 31 May.

Signed by groups including the Property Rights Alliance in the US, Australian Taxpayer’s Union, the Institute for Domocracy and Economic Affairs in Malaysia and the Egyptian Centre for Public Policy, the letter states plain packs for cigarettes have not been proven effective in reducing smoking. Mandated uniform packaging is spreading to other product areas, the authors warn.

“Most outrageously, plain packaging has even been suggested for toys, with the argument that some toys reinforce boys to be “macho” and girls to be “submissive,” therefore, proponents demand a public campaign for plain packaging on toys for children,” the letter states. The text can be accessed at: